COAL OVERVIEW

The Company's mining operations include Westmoreland Mining LLC, which through its subsidiaries, operates four mining complexes, Westmoreland Resources, Inc., which operates the Absaloka Mine, and Westmoreland Kemmerer, Inc. which operates the Kemmerer Mine. The mining operations are described below.

The Company's six surface mine complexes enjoy significant transportation and logistical advantages to their principal customers, which reduce exposure to competition, and long-term coal sales contracts promote stable long-term earnings and cash flows. All but one of Westmoreland's mines are located adjacent to, or only a short conveyor, truck or rail haul from their primary customers. The majority of the Company's coal production is sold under long-term contracts of one year or greater which, as they expire, are anticipated to be followed by extensions, new contracts or spot sales at prices reflecting then current market conditions. Pricing can also change periodically under existing contracts as a result of adjustment provisions for cost and market variances.

WESTMORELAND MINING LLC (WML)  ROSEBUD MINE JEWETT MINE   BEULAH MINE SAVAGE MINE

WML was formed as a separate subsidiary of Westmoreland Coal Company in 2001 to facilitate the acquisitions of the operating coal business of Entech, Inc., a subsidiary of Montana Power, and the coal assets of Knife River Corporation, a subsidiary of MDU Resources. WML provides management and administrative support to its subsidiaries, including operational, environmental, sales and accounting services. WML’s subsidiaries are Western Energy Company (Rosebud Mine), Texas Westmoreland Coal Co. (Jewett Mine), Dakota Westmoreland Corporation (Beulah Mine), and Westmoreland Savage Corporation (Savage Mine).

WESTMORELAND RESOURCES, INC. (WRI)  ABSALOKA MINE

WRI was formed by Westmoreland and a group of partners to lease coal reserves from the Crow Tribe of Indians in Montana and develop the Absaloka Mine in the early 1970’s. WRI shipped its first coal from the mine in 1974. Over the years, Westmoreland acquired the partnership interests of others and, as part of its renewal strategy, increased its ownership to 100% in October 2007. Unlike Westmoreland’s other mining operations that supply contiguous power generation facilities, the coal produced at this mine requires rail transport to its principal customers in Minnesota. WRI enjoys a proximity advantage to this customer relative to its main competitors.

WESTMORELAND KEMMERER, INC. (WKI)  KEMMERER MINE

WKI was formed to acquire the assets of the Kemmerer Mine.  Unlike Westmoreland Coal Company's other mines that use draglines for mining, Kemmerer is a truck and shovel operation.  The Kemmerer Mine is a 13,400-acre mine complex located in the southwest corner of Wyoming.  It supplies coal to the Naughton Power Station by overland conveyor and to a number of industrial customers either by rail or truck.